I was just flicking through the housing bubble bursting thread on boards, and my god the nonsense that is being posted by some. Are Irish people very financially naive or is this common to people everywhere? I’ve lived in Germany for a while and while I’ve seen some people fall into traps, I’ve don’t remember the same general level of naivity.
I’m not talking about whether house prices or going to fall or not in the near term, that’s a reasonable debate. I’m talking about people who won’t invest in a pension because “shares will crash and you’ll be left with nothing” or the sheer number of people who will only invest in property because “you’ll always have the 4 walls”. How about those you see posting who ask questions like “I’ve been promised 40% a year return investing in Mongolian ostrich farms, do you think this is a good idea?”. The biggest pyramid scheme in Europe occurred in Albania which is probably a country we see as backward and slightly clueless in terms of managing their finances, yet there’s half of Cork and Kerry who fell victim to one last year (don’t mention “women helping women”)
What worries me is that as a nation we’ve been protected by defined benefit pension schemes. No matter how bad you’ve managed your investments, you will get a % of your salary when you retire. Now we’ve moved to defined contribution, I think there’s a lot of people who are going to be retiring into poverty.